S4e15 The Managing Trust Edition with Peter Lavers

James Nathan  00:54

Hello and welcome to The Only One Business Show with me your host James Nathan and a fabulous guests for you today and a real clear focus on B2B as well which is going to be nice. This gentleman is the co founder and director of Customer Attuned Limited, an expert and IBM futurist in CRM and Customer Experience Management. He is recognised as a top influencer in that subject. His early career was with Rolls Royce and Bentley Motors, where he trained as an engineer and then went on to hold senior roles in commercial logistics, market analysis, customer satisfaction, regional marketing, and his last client side position as head of relationship marketing. As a client he engaged a customer management consultancy called Q CI and subsequently joined them rising to become managing director after its takeover by OgilvyOne worldwide. He then went on to become Managing Director of Customer futures Ogilvy’s international network of learning groups focused on the design and delivery of a competitive and profitable customer experience. Please welcome Peter Lavers. Peter, hi, how are you?

 

Peter Lavers  02:00

Hello, and thank you for having me

 

James Nathan  02:02

That’s a pleasure. We started the conversation before we went live with whisky and now you’ve got that in my head but you’ve worked with some fabulous businesses. How did you end up moving from being an engineer to getting involved in relationship marketing

 

Peter Lavers  02:17

Do you know, it was it was many moons ago now the then head on board member for sales and marketing pulled me into his office in the in the lovely grand establishment in Crewe in Cheshire, which is now Bentley Motors. And said, Peter, we want to we want to do CRM, will you find out what CRM is and help us do it and so I embarked on a journey. So my background had included things like total quality management, and of course, working for Rolls Royce and Bentley, a there was an amazing focus on quality, and on consistency in all the things that that the founders of both Rolls Royce and Bentley were passionate about. And so I went from that, effectively applying it in a product sense of quality, into applying it in the customer experience sense. And I would, I would really endorse that to, to listeners think about quality. I was a different car company as a consultant, I was standing in front of a of a senior group, somewhere on mainland Europe. And I said to them, if you just thought about your customer experience with the same level of quality assurance and quality management, that you manage the design, the production, the parts, the service of your cars, well actually, you’d be doing better. And that was a real colour light bulb bulb moment for them. And for me, it was it really kind of solidified. What I’ve learned, and I think it comes out of my engineering background as well, is the idea of systemic thinking. And it’s like, what if you want these outcomes from your customer experience? Be that satisfied customers profitable customers? A great experience people who promote people who who endorse your product and your and your service? Well, what is the business system you need to put in place to ensure and assure those outcomes and so many businesses have lovely words in their in their mission statements, how they love customers even obsessed about customers, but they’re actually not that well organised to actually deliver the outcome. So then the systemic thinking, some kind of step above this and say, what are we actually trying to achieve here? I can’t believe so many businesses still don’t have a customer strategy that kind of sits across Sales, Marketing, Service, after sales, contact centres, you know, there’s a whole mixture of channels and departments that deliver the customer experience, but actually, they’re not, they don’t have that golden thread through it. And sometimes, and I’m glad to see more organisations are appointing Chief Customer Officers or that type of role. And that’s, I think that’s a really good move, because somebody needs to be joining up both internally, the processes and the departments and externally the customer journey to say is this actually adding up to the experience that our customers, whether they’re B2B or B2C? Actually, need deserve, require, pay for?

 

James Nathan  06:10

Well, I mean, we will, we’ll move on to B2B but I just, when you started talking there about Rolls Royce, and I’m thinking, in my mind, and I know the previous the history of Rolls Royce being, you know, when you first wanted to buy one of those cars, you went to a coach builder, and got them to measure you. And then they went back to Rolls Royce, and they, you know, the two parts got mixed together, and suddenly a car was produced, and it was very, very much about the individual. And in my mind, although I haven’t a Rolls Royce, and I don’t think I’ll ever be in a position to to nip down to a showroom to buy one I would, you know, my mind, it must be an extraordinary experience to go and to choose that kind of car. But then to say there’s no strategy over the top of that all we need to do CRM astounds me.

 

Peter Lavers  07:02

Yeah, it’s something that I’m passionate about, it’s one of the things that that too many companies almost want to go into the, into the delighting customers. But actually, you’ve got to get the basics right, you got to earn the right to deliver extra value. And it’s very, very interesting to see how expectations have arisen. So things that were only available to, to Rolls Royce and Bentley owners and to Concorde fliers and things like that, in terms of the experience it’s actually now much more readily available. And of course, digital has helped with that in terms of bringing those costs of a much more personal or personalised service down. But the what under lies, what you were saying is the real need to understand customers, and to meet them where they are in their journey, and then to deliver against those expectations. But importantly, from the business to do it in a profitable or a cost effective way. And I often hear a lot of talk about Concord service, in businesses that cannot afford to give good service or can only afford and the hence the kind of the key accounts kind of thinking you can only afford to give whatever it is in terms of a much higher value of service or a greater personalization or personal service to those top typically 5%, you know, isn’t? It’s not necessarily even the 80/20 rule here. You know, it’s the top proportion of customers. And of course, that’s something that customer strategy needs to needs to pull out. How do we define what a key customer is? What a potential key customer is? And then how do we allocate our resources to match the value effectively?

 

James Nathan  09:20

Because I can see how in B2C, that’s very obvious. If we think about airlines, perhaps you know, the way you’re treated when you walk into first class or business class quite different to the way he treated when you walk into economy. Now, that annoys me, because I don’t believe you should be treated differently. And I think a good business would treat people equally. The service you get and the quality of the napkins, what you eat, you know, that sort of stuff is different. And you’d expect that to be the case because there’s a massive cost implications to all of it. But how does that differ in B2B? Because I you know what, surely keep customer key accounts get treated, I appreciate you know, you spend more… its the 80/20 thing, isn’t it, you know, 80% of your effort on 20% of your client base. But surely we should be treating all clients equally so that we can move them from, you know, B to A.

 

Peter Lavers  09:20

It’s, it’s a really interesting point. And it’s, it’s something that I’ve done a lot of work with, with clients in in terms of understanding customer value, both on the B2C and the B2B realms. And, and so a very analytics, very data science based, you know, understanding revenues costs, to create a value model, and we’ve built those models for some, for some major brands around the world. And for me, it’s not about giving less service to anybody. Everybody has to have a standard of service, otherwise, you lose your reputation, you lose trust. And indeed, you don’t then grow value, if you if you’re trying to cut and unfortunately, lots of companies now you know, are managed by it by the bean counters, particularly over the last probably 10 years, the various financial ups and downs we’ve we’ve been in, and certainly no disrespect to accountants, by the way.

 

James Nathan  11:32

Well, I used to be one but I escaped.

 

Peter Lavers  11:33

And so so there were initiatives like channel shift, where we’re going to force you as a customer off of what we see as a, as an expensive cost to serve channel, and we’re going to force you into a lower cost to serve channel and, and unfortunately, with things like that, and you’ll also see it where cuts are made across the board. And when cuts are made across the board, it’s often the best customers who suffer more than the lower value customers. So I would, I would say it’s not about…. some people even use it to say which customers we want to fire. And I’m not sure that’s the, you know, the appropriate thing to say. The only reason for for firing customer would be a fraud, basically, you know, something illegal happening. I worked with, with a really great bank once in, in North America. And they they had like a saying, which was any unprofitable customers are our fault. Obviously, not not talking about fraudulent, but basically say we’re not serving them appropriately. So for me, it’s not about a low standard for anybody, it’s about an appropriate standard. And of course, the higher up the value chain, and you asked about B2B, for those key accounts, you have opportunities to partner to co create, for even do joint working yet even have colocation of staff, you know, my staff in your business, your staff in my business. We jointly develop solutions, and actually, we become a really trusted partner solving business issues, rather than just supplying stuff. And, and that’s where I think in the B2B there for the higher value. Now, it’s not only value, of course, because there’s also an appetite, there’ll be some incredibly high value customers that don’t want that they actually still want, yes, a very valuable but but actually quite transactional relationship. There are others who do want to partner and see the value that you add to their, their business system. And,  they trust you to see more of their issues so that you can actually bring your expertise, which they couldn’t hire, you know, full time, but they want, they want to bring into on to, you know, into their IP as a business and and that’s, that’s when it works really well. And that’s when trust is really built strongly.

 

James Nathan  14:24

So give us an example of that kind of co working situation that you’ve seen with businesses and how it’s developed and benefited them.

 

Peter Lavers  14:32

Well, a great example that immediately springs to mind is during transitions. So in B2B, the when either a contract is coming to an end, or maybe some key people have changed or the supplier company has expanded or acquired another, another business and you’re in a period of transition. And very often, those are when the relationship is made or broken, when you’re actually need to get together to solve issues in a dynamic way. So I’ve seen some, I’ve seen some great examples at the start. So a new supplier in the in terms of their onboarding process, actually getting people in. So I’m thinking of a major telecoms business at the moment. So the really good examples of making that transition from one supplier to another as as good as possible. I’ve also seen good examples. And actually a lot of bad examples of actually when key people change on one side or the other. So either the key supplier person, the account director, whatever they called, or the key point person, within the customer, the B2B customer. And actually, I’ve seen the whole relationship break, because because those, that personal relationship at a senior level, is not managed well. And then at the end, in terms of the transition out of actually working with a client at the moment, and, and all credit to them, so a big B2B supplier, I won’t tell you which sector it’s in, but a big B2B supplier, saying to their customer who’s going through a retendering process at the moment, so they may lose the business, but they’re saying, we want this to be the best period of transition as possible. We want everybody involved to still want to get up and go to work, and to be fulfilled and to say, whatever the outcome, we’re going to manage this as well as we possibly can, for the sake of the relationship and to be honest, the, for the supplier side, it then becomes, you know, a use case a case study of not only how well, we take you on because so much in business isn’t it’s all focused at the front end, it’s all focused on the sale, and and getting the business in. And then some other poor person has to, or team or department has to do the onboarding and the servicing and then at the end, you’re the sales team come back in and wonder why they’ve got to start from scratch, but actually having that kind of lifecycle view, because well, it’s one of the massive differences in B2B and B2C is mostly in B2C, you can walk away or get out of a contract reasonably easily, you know, okay, you might be tied in for your mobile phone. But if you’re willing to pay, you know, enough, you can you can just switch provider pretty easily. Or is it in b2B, you know, we’re talking typically multi year contracts, we’re talking multiple stakeholders on both sides. So, so making those changes is difficult, and the b2b companies that do that, well, you know, are definitely going to win, you know, and, and, and be competitive in the market.

 

James Nathan  18:44

So what can a business to have, and I’m thinking to Demeter step backwards. So remember from my own experience working with in recruitment, and one of our big clients was Asda Stores are being late and they were a magic client, fun to work with great business, great people. And as I was not the account manager, I was the buddy account manager, because my manager was the account manager. But every year we had to go and do something within their business. Now, the one I remember the most was putting cheese in quiche tin, cases, because they insisted that, you know, suppliers were engaged in their business in that way. But when their head of recruitment changed, they were very, very careful to make sure that that relationship was maintained with their key suppliers of which we were one. And I remember it stuck in my mind as a very clear example of how you can very easily do something or you could just leave it alone and let the whole thing fall apart. What can people…. what can businesses do to make sure that the relationships are broader than those one or two people? What should they be doing and thinking?

 

Peter Lavers  19:55

That’s, it’s a really good point. And just as an aside, it’s one thing because I’ve worked with with businesses all over the world. And one thing that I’ve noticed is that customer centric or truly customer centric businesses are also very good with their suppliers. They recognise the value chain, they recognise that the experience that their customers go through, are often rooted in how well they manage their supply, so that so they don’t see it as different departments, you know, with completely different kinds of cultures, almost some unfortunately do that. But actually, the really best businesses see that, see that through. So what can companies do? So I’m going to refer to some of the work that my colleague has done. So one of my co directors is a chap called Dr. Mark Holyoake. And he’s spent six years looking at the dynamic of trust, within business to business. And, and he’s come up with a brilliant definition and a model and like, an S curve, sort of maturity model of trust, and I’d highly recommend taking a look at it, I don’t have time to talk you through it. But one of the things that, that he uncovered was how trust works at different levels, kind of person to person level, at, at organisation to organisation level, and then of course, the senior teams. And I believe that trust is, is one of the most vital things for businesses to realise that actually, you can manage this and trust isn’t just doing what you say, when you said you were going to do it, that’s an element that that Mark uncovered. But but trust is actually something bigger than that. Trust is actually, and I’m paraphrasing him horribly here. But, trust is a bit similar to, to risk kind of management and analysis. And if you think about that, you know, we often will have risk managers, most big businesses will have risk managers and, and obviously financial services organisations see all their customers as a pressure on insurance. But actually, if you think about it, what is you know, and a big element of trust is the customer willing to take a risk with us, as a supplier for some of their value system to deliver to their customers. So they’re taking a risk with us. And when we start thinking in those terms, and when we think about, as I was saying the the various levels, that there are actually there’s, there’s a lot that can be done with… to manage trust. And that’s a concept that a lot of people think, ah, hang on, how do we do that, but it’s a bit similar to, to customer experience. One of the things about customer experience. So I often get asked, you know, what’s the difference between customer experience and CRM. And one of the things one of the differences is CRM is what you do for your customers, you decide to do direct marketing, you decide to get in touch with them, you keep their data on the database, but actually customer experience is what they’re doing it it is essentially customer centric. And the key thing about the customer experience is that it’s going to happen anyway. So they get a hands on experience, whether you try to manage it or not, you know, however, whether you’re interested in it, they’re still going to have that customer experience. And so the business decision is, well, are we going to manage this or not? Or are we just going to let it happen by accident? And it’s a similar thing with trust? Are we going to, are we going to manage trust? Or are we just going to let it you know, let it rise and fall? And you know, and I think smart businesses from now on are going to be taking those key strategic decisions, which say no, we are going to manage the customer experience. We are going to understand needs better and meet customers, whether they’re B2B or B2C, in the channel that they choose at the point of their journey because we’ve mapped it and we understand it. And we’re going to and we’re going to co create or deliver solutions that meet those needs at their point in their journey or maturity as a business or however we model that. And this kind of comes back to where I’m where I started, you know, lots of businesses don’t have a customer strategy. And they said, Well, yeah, why do we need a customer strategy? Well, hopefully I’ve just described some of the need to have a customer strategy. Because if you don’t, if you don’t say, no, we want to manage the experience. We want to manage trust, we want to everybody, everybody says they want to be trusted, trusted advisor and all that. Everybody says it, what does that actually mean? How do you know? Well, you know, when you lose it, don’t yet but how do you how do you know you’re actually managing this?

 

James Nathan  25:50

What’s the future Peter? If we look into into what’s going on? Where are the trends? And where’s the future of relationship management and experience management?

 

Peter Lavers  26:00

I think I think he’s going to be very value driven. And obviously, now, we’re going through an incredibly volatile, volatile period. I’m not sure, you know, when, when that’s going to end but we know that what, what comes out of this, you know, we’ve we’ve probably all sick of hearing new normal, but, but we know that that things are fundamentally changing business to businesses are having to have difficult conversations in every sector. And what were very nice, comfortable business relationships are now under stress, and strain. And so what has got to happen is that we need to take the pain away for the operational that, you know, everyone would have been talking, what 15 years about ETDB: easy to do business in, in the B2B. So obviously digital as helped that and, and now, obviously, with the extra communication channels that we have open to us, we don’t have to sit in the car to have to have a 10 minute conversation with the client. We can we can do that on Zoom or Teams. But now it’s all going to be about where is the value? We you know, why does Why do I need to get in the car and go and have an hour meeting with a particular client, but that for a different client, I can just do on a on a team’s call. So in  the future, we have got get smarter, we’ve got to get our people focused on what is adding value in that relationship and taking the other stuff away. There’s still masses of firefighting. Now we kind of understand that in through the pandemic, and, you know, in in the current situation with inflation, energy prices, etc. There is always going to be some element of firefighting, but it’s one of the things that I think, is really important. Who is thinking strategically, who is thinking of the bigger picture as we go through these crises? And, and where is value going to be added from b2b in particular relationships? And how can we start making sure we’ve got the right people because the, you know, that the traditional, possibly stereotypical account director of the past, you know, gin and tonics and golf, you know, isn’t isn’t necessarily going to be the right, the right person to build, you know…. coming back to 80/20, you know, maybe 80%, digital relationships, and 20% of where the real value is being added. Yeah. And, and, and, and putting the time and the people and the resource into things like co creation, things like joint problem solving, finding those clients who are willing to commit to the long run with you as a business rather than just treat you as a widget provider and build those relationships

 

James Nathan  29:59

And It’s interesting. So as much as I love gin, and I enjoy golf, I’m not great at it. The reality is, I think we’re a very, very long past that kind of thing. But also those personal interactions, our ability to go and meet someone and see them face to face, I think there’s something very lovely about the opportunity to do that. But I think it’s interesting the way you’ve described, you know, that the speed of relationship build could be changed, or the has changed forever with the ability to see people and talk to them on screens. You know, I know in my training business, spending a lot of time helping people use that medium better, to make it feel more natural. And that’s something I think that people need to think a lot about is if I’m having a lot of my interactions this way, you know, I’m not just sitting with a laptop on my knee, and someone’s staring up my nose and all the other horrible things that you, you sometimes come across. But, Peter, you’ve given us a huge amount of detail, and lots and lots of things to think about there. But can I ask you one last question, or one big question, I guess, which is, what’s your big thing, the golden nugget that you would leave people with today? To help them make their businesses better for today and better for the years to come? What would that be?

 

Peter Lavers  31:13

I think I’d refer back to trust. It’s something that that saddens me so much is, and just think about it in your business as well. The only time you often hear about trust is when a company has lost it. And you hear the chief executive like grovelling and saying how they’re going to rebuild trust. And I would I would say, don’t leave it that long start thinking about how to build trust. I referenced back about how trust is almost the other side of the coin to risk. And it’s it’s I find it so interesting that most businesses have a Risk Officer, who’s the trust officer? Who’s responsible for managing trust, you know, I’m not suggesting we have a chief trust officer in, in business, although maybe you maybe you want one, but but certainly needs to think about, you know, what are we doing? So one of the big things that that that destroys trust, to be honest, is the short termism of quarterly sales and toxic sales cultures where things are done at the end of the quarter, which actually get the number in, but damage trust, who has the responsibility in our business to say: Hang on? We’re not…. we’re going to stop doing that basically. Because we’re going for the wrong thing here. We’re objective advising the wrong thing in our business, and it’s actually damaging long term relationships for the sake of, of somebody’s quarterly bonus that can be right up to the chief executive, of course, so it’s got to be, it’s got to be somebody with some teeth.

 

James Nathan  33:15

Fantastic. Thank you so so much, Peter. It’s lovely chatting with you.

 

Peter Lavers  33:20

You’re welcome. It’s been great chatting. Thank you.